VZCZCXRO5939
RR RUEHDBU RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHSK #0582/01 1531040
ZNY CCCCC ZZH
R 021040Z JUN 06
FM AMEMBASSY MINSK
TO RUEHC/SECSTATE WASHDC 4494
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RHMFISS/HQ USEUCOM VAIHINGEN GE
RUFOADA/JAC MOLESWORTH RAF MOLESWORTH UK

C O N F I D E N T I A L SECTION 01 OF 03 MINSK 000582 
 
SIPDIS 
 
SIPDIS 
KIEV FOR USAID 
DEPT ALSO FOR EUR/OHI 
 
E.O. 12958: DECL: 06/02/2016 
TAGS: PGOV ECON PHUM KNAR BO
SUBJECT: PINSK VISIT NOT IDEOLOGICALLY PURE 
 
REF: A. 05 MINSK 1126 
     ¶B. MINSK 393 
 
Classified By: DCM CONSTANCE PHLIPOT FOR REASONS 1.4 (B, D) 
 
¶1. (C) Summary: On May 24 and 25 DCM and Econoff visited the 
southern cities of Pinsk, Beryoza and Beloozyersk, as well as 
a newly discovered Holocaust mass grave near Bronnaya Gora. 
Local activists in Beryoza seemed preoccupied with their 
problems with the BKGB, but activists in Beloozyersk are 
already planning for 2007 local elections.  Most meetings in 
Pinsk were held with the knowledge and approval of local 
officials, who however grew angry when Emboffs deviated from 
the official plan and met a local independent journalist.  In 
Pinsk Emboffs toured a textile factory partially owned by 
Belarus' security services, spoke with the mayor, delivered a 
donation to the American Corner, and listened to the many 
problems faced by a local American investor.  Throughout the 
Pinsk visit Emboffs were accompanied by a local ideological 
officer, a state television crew, uniformed police and 
presumed members of the BKGB.  Emboffs did not get a chance 
to watch or play Pinsk's premier sport, motoball (soccer 
played from a 
motorcycle).  End summary. 
 
 
Too Much Love from the GOB in Pinsk 
----------------------------------- 
 
¶2. (U) DCM and Econoff visited the southern cities of 
Beryoza, Beloozyersk and Pinsk May 24 to 25.  The bulk of the 
trip was spent in Pinsk, where local authorities reacted to 
the visit with a welcoming but heavy hand.  A city 
ideological officer, a marked police vehicle, and a state 
television crew accompanied Emboffs at all times.  They were 
periodically joined by several plainclothes people Emboffs 
suspect were BKGB.  At times local authorities had four 
vehicles accompanying the embassy's single car.  The visit 
was relatively frictionless, with Emboffs holding only city 
"approved" meetings, until the end, when Emboffs stopped off 
in a caf to speak with an independent journalist (who was 
afterwards immediately questioned by both state media and 
state security).  After that meeting the ideological escort 
turned frosty, the state camera crew asked DCM why she held a 
"conspiratorial meeting" with "a social-democrat," and the 
police vehicle escorted Emboffs at great speed to the city 
limits. 
 
 
Pinsk's Confident Mayor 
----------------------- 
 
¶3. (U) Emboffs met with the mayor of Pinsk, as well as his 
deputies for social and business affairs.  The mayor 
explained that Pinsk is Belarus' tenth largest city with 
130,000 inhabitants, and that it is growing due to domestic 
migration.  Pinsk is an industrial city, and local industry 
provides most of the city government's USD 20 million in 
monthly tax revenue.  The largest company is the private 
Pinskdrev furniture factory, while small businesses, mostly 
in construction and hair salons, provide 15% of tax revenue. 
The city spends half of its budget on health care, but is 
also building a new university (funded by the National Bank 
of Belarus), and recently opened a restored historic theater. 
 Pinsk also is proud to host Europe's only dedicated motoball 
stadium -- a form of soccer played on motorcycles.  When 
asked about NGOs, the mayor's staff recited the registered 
political parties in the region, but added that the state 
really provides for all needs, so NGOs are not necessary. 
The mayor explained that 
 Pinsk region prides itself on its agriculture, and imports 
John Deere tractors. 
 
 
Textiles for State Security 
--------------------------- 
 
¶4. (SBU) Local officials then accompanied Emboffs on tours of 
a local joint venture textile factory and an outlet store for 
a state-owned textile plant.  The management explained the 
state factory was currently not working due to the transition 
between seasons.  The management proudly showed off the 
factory's clothing, which was of poor quality and out of date. 
 
¶5. (U) Emboffs than toured an Austrian/Belarusian joint 
venture that produces sportswear for Champion Europe.  This 
factory uses modern equipment, had a small staff, and clearly 
produced quality fabric.  The plant's manager explained the 
plant was 60% owned by an Austrian investor and 40% by 
 
MINSK 00000582  002 OF 003 
 
 
Minsk's Dynamo Sports Club.  He added that Dynamo (which owns 
Belarus' most successful soccer team and Minsk's largest 
outdoor stadium, as well as other businesses) is owned by a 
consortium of Belarus' security services, including the 
Ministry of Defense, BKGB, State Customs Committee, and 
Ministry of Interior. 
 
 
Hardships for an American Investor 
---------------------------------- 
 
¶6. (C) Emboffs met with Mark Homnick, an American whose 
company Silicon Materials has been producing silicon wafers 
for export to the U.S for twelve years.  Although his company 
is profitable, Mark stated that he constantly faces 
bureaucratic problems from the government that hamper his 
business.  He explained that all companies in Belarus face 
such problems, he has never been singled out for being a 
foreigner.  When he initially invested in Belarus, he entered 
into a joint venture with a failing Belarusian silicon wafer 
manufacturer, which has caused numerous problems.  His 
state-owned partner contributes nothing to the business. 
Last year Mark had to install a USD 100,000 water 
purification system to remove contaminants from his chips. 
His partner tried to block this upgrade, as it would throw 
off the ownership ratio of how much each party had 
contributed to the company.  To overcome this hurdle and 
avoid accidentally investing in his own firm, Mark imported 
the goods as "humanitarian assistance" to his c 
ompany.  Although he said local officials are sympathetic, 
they explained he now faces massive fines and possibly jail 
for making an illegal donation to a Belarusian entity, under 
recently amended laws designed to prevent foreign donors from 
aiding political NGOs.  Mark thinks he can overcome this 
barrier. 
 
¶7. (C) Mark also wants to bring in new equipment to double 
production, but his local partner is trying to prevent this 
move, and he faces taxes worth more than the equipment 
itself.  To bypass these problems he is contemplating 
creating a shell company to import and legally own the new 
equipment.  Mark stated that all companies in Belarus face 
continuous state inspections, extremely high taxes, and a 
stifling legal environment.  For example, Mark recently 
bought a used building and wants to renovate and modernize 
the space.  However, under Belarusian law any renovation that 
costs more than 10% of the value of the building is 
classified as new construction and requires expensive fees 
and taxes.  Because of laws designed to protect domestic 
industry, Silicon Materials cannot do any contract work for 
local manufacturers, even recently when the state-owned 
silicon chip company Integral wanted Silicon Materials' help 
in a process for which Integral did not have the proper 
equipment.  The GOB refused to allow this 
cooperation. 
 
¶8. (C) Mark said he could easily double his production if the 
GOB would slightly ease the regulatory burden.  Even though 
he loves Pinsk (and married a local), he claimed he would 
possibly not have entered the Belarusian market if he knew he 
would face so many problems.  Mark has considered moving his 
company to Poland, but stated the GOB would never let him 
export his machinery. 
 
¶9. (C) Mark also claimed that just before the March 
presidential elections he received an invitation from the 
mayor to a meeting of all regional enterprise directors to 
"prepare for" the elections.  He went to the meeting, but the 
room grew silent when the American entered.  An obviously 
embarrassed mayor asked if Mark had been invited, and then 
politely asked Mark to leave, claiming the meeting was only 
for directors of state enterprises. 
 
 
Ideologically Unpure Journalist 
------------------------------- 
 
¶10. (U) In other meetings in Pinsk, DCM donated additional 
books and equipment to an American Corner in the local 
library, spoke to 35 local English students, gave a short 
interview to our state media escorts, and met with officials 
at the local Catholic monastery.  In the meeting that 
provoked the ire of our escorts, Emboffs spoke with a local 
independent journalist.  His newspaper, Mestovoy Chas, has a 
weekly circulation of 1,400.  This fell from over 2,000 after 
the state blocked their access to the state postal and kiosk 
distribution systems.  During the election period this 
journalist went to jail twice, once for five days for 
allegedly swearing in public and once for six days for 
 
MINSK 00000582  003 OF 003 
 
 
alleged hooliganism, although he claimed he was arrested 
while bringing his daughter to school.  He explained that 
Pinsk residents are mostly worried about economic matters, 
such as natural gas prices and salaries, and are not much 
interested in politics.  His paper survives with difficulty, 
but he claimed that many officials i 
n local government read his paper for a more accurate report 
of what is happening in the region.  He added that opposition 
newspapers Narodnaya Volya and Nasha Niva are sometimes 
available in Pinsk. 
 
 
Holocaust Mass Grave Found 
-------------------------- 
 
¶11. (U) On the way to Pinsk, outside the village of Bronnaya 
Gora, Emboffs met with several local women who, after 
diligent research, uncovered a mass grave dating from the 
Holocaust.  They had discovered that the occupying Germans 
gathered the local Jewish population, several thousand 
people, and shot and buried them in a nearby forest.  The 
group has permission from local authorities to erect a 
monument on the site, but is looking for funding.  DCM 
promised to pass their story along to possibly interested 
American groups. 
 
 
Despair in Beryoza 
------------------ 
 
¶12. (C) Last September Econoff visited the local opposition 
in Beryoza and found a vibrant and active group (ref A). 
Emboffs met with the same group on May 24.  They remain 
active, and were collating a local underground independent 
newspaper during the visit.  However, Emboffs this time found 
them to be preoccupied with the problems they face from the 
regime.  They explained the BKGB has questioned most of them, 
using the pretext of investigating the Partnership arrests 
(ref B).  All claimed the BKGB follows them and listens to 
their phones, as well as to phones of their relatives.  The 
BKGB even called one activist's underage daughter to ask why 
she allows her mother to make political calls on her phone. 
The group repeatedly commented that the BKGB was listening to 
the current conversation and had a vehicle outside watching. 
Activists had been brought to court three times for 
distributing an unregistered newspaper, and currently face a 
fine of BYR 2.3 million (USD 1,070) for defamation after they 
reported 
 the commander of the local airbase was dishonorably 
discharged for criminal activity.  Unfortunately for the 
activists, this commander was also head of the local 
pro-Lukashenko Communist Party.  They all commented that 
regime pressure had increased after the election was over, 
rather than lessening as expected.  The group also told more 
of the same stories Emboffs hear throughout Belarus of 
opposition activists arrested, election observers not being 
allowed to observe vote counting, and of the local election 
commission member who refused to sign the falsified election 
protocols. 
 
 
But Beloozyersk Still Upbeat 
---------------------------- 
 
¶13. (C) In contrast to Beryoza, local activists in 
Beloozyersk were more focused on what they are doing, rather 
than what the regime is doing to them.  Beloozyersk activists 
told Emboffs they have held several post-election meetings to 
start planning for the 2007 local elections.  They also 
conducted a poll of 500 local residents and found that 63.8% 
said they voted for Lukashenko, while 20.3% voted for 
Milinkevich (versus official nationwide results of 83% and 6% 
respectively).  Local activist Yury Gubarevich explained that 
he thought local residents seemed more supportive of the 
opposition in 2001 and 2004 elections than in 2006.  The 
Beloozyersk activists also run a regional resource center 
that publishes a bi-weekly newspaper with 1,350 copies, and 
helps a local women's group and several groups in other 
cities publish their newspapers. 
Krol